Monro Expanding Into California Via Acquisition; Turnaround Continues
Monro Inc. (Rochester, NY) has signed a definitive agreement to acquire California-based Certified Tire & Service Centers, which has 40 retail locations in San Francisco, San Diego and Los Angeles, as well as a distribution center in Riverside. Financial terms of the transaction were not disclosed.
The deal is expected to close in the first quarter of fiscal 2020 (for Monro, the three months ending June 30, 2019), and add roughly $45 million in annualized sales, representing a sales mix of 70 percent service and 30 percent tires.
The move represents entry into a new state for Monro and expands the company’s geographic footprint to the West Coast. Monro President and CEO Brett Ponton said the acquisition provides the company with a strong platform for further expansion in the region.
“The diversification of our geographic footprint in California represents a key milestone in the execution of our growth strategy, and we look forward to capitalizing on future opportunities in this market,” Ponton stated. “We believe that the continued execution of our ‘Monro Forward’ initiatives will position us to more effectively and efficiently integrate this and other acquisitions, creating long-term shareholder value.”
Monro plans to continue to operate all of Certified Tire’s locations.
Analysts with Jefferies LLC view the acquisition as “the most adventurous M&A move in recent memory,” noting that prior Monro management limited growth to the predominantly East Coast chain to contiguous markets.
“Given the significant size of the California fleet (roughly 15 million cars) and long average vehicle life span (limited corrosion), we see the potential for further West Coast expansion, particularly as more private equity/financial buyer backed M&A competition seems to be concentrated in the eastern U.S.,” analysts Bret Jordan, Mark Jordan and Ethan Huntley wrote in a March 21 report.
They added: “While making Monro’s target of 10-percent annual growth via M&A more achievable by expanding the target markets, we do see some incremental execution risk in bi-coastal operations.”
Jefferies’ report — which followed a day with Monro’s CEO and CFO — also asserts that the company remains in turnaround mode, with increased investment in both service and infrastructure. “Notably, just over 30 of the roughly 1,200 stores have been physically re-set, while the more customer-centric store operations model rolls out at a more rapid pace,” the analysts wrote.
The report also states that significant internal systems change appears to be in process, as a major tablet initiative is in place to give store operators more real-time data on performance. Additionally, according to Jefferies, significant labor model changes are underway in an attempt to more closely match labor skills to work complexity. “Management noted that current labor is generally overqualified, as 70 percent of Monro work orders typically require lower-skilled labor than is staffed,” the report states.
GB Auto Acquires Evans Tire & Service Centers
GB Auto Service, a portfolio company of the Greenbriar Equity Group, has acquired Evans Tire & Service Centers. Financial details of the transaction were not disclosed.
Founded in 1976, Evans operates 18 locations in the San Diego area, from Chula Vista in the south to Vista in the north and El Cajon in the east. The company’s recent expansion efforts included three new shops in 2017 and one more last year.
In addition to tire sales, the company offers oil changes, brake service, fluid exchange, factory-scheduled maintenance, shocks and struts, cooling system service, and battery work.
John Daileader, managing partner at Greenbriar (Rye, NY), declined to comment on how the deal fits into the existing GB Auto Service platform.
GB provides automotive aftermarket repair service from about 65 retail locations in the Southwest. The company operates under the BRAKEmax, Tire Works and Ramona brands, offering tire replacement, brake repair and other undercar services, as well as alignment work, A/C service, exhaust work and oil changes.
Synchrony Expands Auto-Related Credit Categories
Synchrony Financial (Stamford, CT) has expanded its Car Care credit services to include more auto-related categories and locations. In addition to parts, service, gas and car washes, the card is now being accepted by select automotive paint, tire, towing, parking and ride-sharing providers.
In all, the credit now applies to 25 categories at more than 500,000 locations, including independently owned service shops, in the United States. New locations include AutoZone, Firestone, NTB, Uber, Lyft, ABRA Auto, and Econo Auto Painting & Body Works.
Synchrony partnered with the Discover Global Network to make the expansion possible.
Independent Repair Shops Are Closing The Satisfaction Gap
Overall satisfaction with services performed by independent vehicle repair facilities has improved 22 points since 2017, according to the latest J.D. Power Customer Service Index (CSI) Study. This compares with a 17-point improvement for franchised dealers. Similarly, satisfaction with service quality at independent repair shops has improved 23 points since 2017, compared with a 17-point improvement by franchised dealers.
The study is based on responses from 57,286 owners and lessees of 2016- to 2018-model-year vehicles. It was fielded from October through December 2018. The study provides a numerical index ranking based on the combined scores of five measures of the vehicle owner service experience: service quality, service initiation, service advisor, service facility and vehicle pick-up.
According to J.D. Power, satisfaction scores tend to increase when service departments use customers’ preferred methods of communication, yet many dealerships are not regularly doing so.
Satisfaction was 75 points higher on a 1,000-point scale among customers who had an all-digital experience, compared with one that is all analog. According to the firm, customers prefer to schedule service over the internet and communicate with the shop via text messages, rather than doing these tasks over the phone. And, satisfaction increased further when a service advisor used a tablet during the service visit.
“Thirty-four percent of customers indicate they prefer to communicate via text message, but this only occurs 9 percent of the time,” said Chris Sutton, vice president – U.S. automotive retail practice at J.D. Power. “There’s no reason why this isn’t a more widely adopted practice across the industry.
“Dealers have easy access to these tools, so they don’t have to reinvent the wheel. Technology not only improves efficiency but also — the more satisfied a customer is with their overall service experience — the more likely they are to return to the dealership for service and to recommend the dealership to friends and family members.”
The study also indicated that nearly all generations prefer internet scheduling. While Generation Y customers have shifted their preference toward internet scheduling at a faster rate than have Baby Boomers, every generation — with the exception of Pre-Boomers — has increased its preference for internet scheduling and decreased its preference for phone scheduling over the past five years.
Additionally, the percentage of customers who felt that their service advisor provided helpful advice was 70 points higher when the advisor was focused on them and their needs during the visit. Other factors that boosted a customer’s view of their service advisor’s helpfulness were …
• Informing customers about work performed on the vehicle (+44).
• Knowing the vehicle’s service history (+37).
• Keeping them informed of the vehicle’s status (+33).
• Letting them know when the vehicle would be ready before service begins (+30).
• Performing a vehicle walk-around (+30).
AAA: Americans Spend 70 Billion Hours Behind The Wheel
Americans spend an additional 20 minutes driving each week compared to 2014, according to new research from the AAA Foundation for Traffic Safety. Over the course of the year, Americans collectively spend 70 billion hours behind the wheel — an 8-percent increase since 2014. And, each week, drivers travel more than 220 miles.
This works out to Americans driving an average of 11,498 miles each year — the equivalent of making two roundtrip drives from San Francisco to Washington, DC.
The AAA Foundation’s American Driving Survey shows that, on average, U.S. drivers spend nearly an hour behind the wheel each day and travel 31.50 miles — a 5-percent increase from 2014. Other findings show that …
• Men spend 19 percent more time behind the wheel and drive 27 percent more miles than women.
• People who are married or living with a partner spend at least 12 percent more time driving than those who are not.
• Drivers ages 75 and over spend, on average, eight minutes a day driving — a 23-percent increase from 2014.
• Drivers in the West spend the most time driving at 58.90 minutes per day, followed by drivers in the Northeast (51.10 minutes), South (49.90 minutes) and Midwest (44.50 minutes).
• The number of drivers in the Midwest dropped 3 percent.
• The number of drivers in the Northeast, South and Western regions increased or remained the same.
AAA: Nearly 100 Million Americans To Take Family Vacations This Year
According to a recent AAA Travel survey, nearly 100 million Americans — or roughly 4 in 10 U.S. adults — are planning to take a family vacation in 2019, which is slightly more than last year. Spring and summer road trips will top many of these families’ vacation plans.
According to AAA, 68 percent of all family travelers will embark on a summer getaway, and 45 percent are making plans to travel as a family this spring. And, 53 percent of families expect to do this travel in their cars.
For road trippers, gas prices have averaged nearly $0.25 cheaper so far in 2019 compared with the first few months of last year. While gas prices are increasing now, AAA expects summer prices to be cheaper than in 2018. That’s key considering that another AAA survey found that 33 percent of Americans would go on at least one additional summer road trip if gas prices remain low.
AAA’s family travel research is the result of a telephone survey (landline and cell phone) consisting of 1,007 adults living in the continental United States. Interviewing for this survey was conducted between Jan. 24 and Jan. 27.
Obituary: Stu Zurcher, Longtime Tire Industry Exec.
Stuart “Stu” Zurcher — longtime Indiana tire dealer, founder of the Strategic Alliance Group and former member of the Tire Industry Association’s (TIA) board of directors — died March 13. He was 72.
“Stu Zurcher was an enthusiastic TIA leader, a caring mentor and a long-time supporter of the TIA training programs,” TIA CEO Roy Littlefield said. “He will be greatly missed by his many friends in the tire industry.”
Zurcher studied sheet metal development at International Harvester‘s apprentice school and earned associate’s degrees in mechanical engineering from Indiana University – Purdue University Fort Wayne (IPFW) and the Indiana Institute of Technology. He also served in the U.S. National Guard.
He founded Zurcher Tire of Angola Inc. in Angola, IN in 1974 and managed the business until 2001.
In 2007, Zurcher and tire industry veteran Norm Gaither founded Dealer Strategic Planning Inc. (DSP), the tire industry’s first 20 Group. DSP organizes 20 Group meetings for tire dealers to share best business practices.
Zurcher sold his share of DSP to Gaither in 2011 and started the Strategic Alliance Group, a 20 Group company targeting commercial tire dealers. He was president of the company, which offers tire and automotive service dealers the opportunity to share best practices and financially compare against industry trends to improve profitability.
Zurcher was known for his dedication to education and training for the industry. He served as chair of TIA’s training and education committee.
“I worked with Stu on educational projects within the tire industry and was impressed with his dedication to the long-term health of independent tire dealers across North America,” said Brian Cruickshank, director of the University of the Aftermarket at Northwood University. “No one was more concerned about their success than Stu.”
Rick Guirlinger, a partner at Schwartz Advisors, met Zurcher at a Tire Leadership 21 program at Northwood. Zurcher and other tire dealers collaborated with the university to create a program aimed at cultivating future tire dealership owners and managers.
Zurcher provided him “invaluable information about the tire buisness,” Guirlinger said.
“Stu was instrumental in promoting and forming 20 Groups in the tire industry for the betterment of its owner/operators,” he said. “His commitment to sharing best practices in a collaborative environment assisted many commercial and retail businesses strive to reach their potential and challenge each other to achieve improved results and outcomes.”
Survivors include Zurcher’s daughter, Lesli; and a grandson.
YourMechanic Adds Goodyear.com For Tire Sales/Installation
YourMechanic has added Goodyear.com tire purchase and installation options for its users. It’s the first such offering from the mobile services company, which previously offered only rotations and spare installations in its tire category.
Consumers who visit YourMechanic to search for tires and installation in their area are referred to Goodyear.com, where they can buy tires and schedule installation through Goodyear’s installer network of approximately 4,200 dealers.
The new partnership covers both consumer and fleet purchases.
This is Goodyear’s latest effort to make tire buying easier, said Julianne Roberts, internal communications manager – Americas. Goodyear.com already offers customers free delivery of tires bought online to the company’s network of installers
And, last fall, Goodyear launched a new tire-buying and installation pilot service called Roll by Goodyear in the Washington, DC area. Users can choose various installation options, including scheduling a mobile installation van to come to where they are and install their tires.
New Pricing Options For ALI Lift Safety Training
The Automotive Lift Institute (ALI) now offers an annual subscription option for its “Lifting It Right” online lift safety training course. The annual facility-wide subscription — $240 per facility location — allows everyone at a single location to take the course as often as needed throughout the year.
Another new pricing option for the online course is a lower rate for vocational students or schools. The new student rate is $10 per person. Standard pricing is $16 per participant for the English version of the course and $24 per participant for Spanish.
“Lifting It Right” covers proper lifting practices for all types of vehicle lifts. The course can be taken on a computer or mobile device. For more information, visit autolift.org/ali-store/.
ASA Touts Shop Training Available At Annual Meeting
The upcoming Automotive Service Association Annual Business Meeting & Conference — taking place April 30 to May 2 in Hurst, TX — will include a variety of offerings for shop owners and their staffs. The agenda includes a panel discussion with Jeremy O’Neal of AdvisorFix and Tony Molla, ASA’s vice president of industry relations. They will address issues surrounding the need for new technical and management talent, as well as the challenges faced from a growing shortage of qualified technicians.
Courses available during the meeting will include …
• “ADAS Technical Training” presented by Standard Motor Products.
• “Vehicle Design & Technology” presented by Tom McGee of Spanesi.
• “Pay Programs That Guarantee More Productive Employees & Happier Customers” presented by Bob Cooper of Elite Worldwide.
• “Transformational Service Advisor & The 4 Pillars” presented by O’Neal of AdvisorFix.
• “Maximizing Profits: Selling Diagnostic Services” also presented by O’Neal.
NASTF Announces Details For Spring General Meeting
NASTF has announced topics for its 2019 Spring General meeting, which will be co-located with the Equipment & Tool Institute’s (ETI) ToolTech conference in Charlotte, NC. The NASTF meeting will take place from 9:00 am until noon on May 2, following the close of ToolTech.
The NASTF meeting’s agenda includes a session titled “Stop Eating Our Young,” where experts will discuss selecting, on-boarding, mentoring, and fast-tracking knowledge and motor skill development for young technicians. This comes in response to data indicating that 42 percent of new technicians leave the industry within their first two years.
Also on the agenda …
• The new service technology team will present plans for modernizing NASTF’s web presence and offerings.
• The vehicle security team will discuss the release of the SDRM 2.0 web portal, as well as an addition to the D1 use cases within SDRM that aims to reduce vehicle theft and false reports of thefts.
NASTF general meetings are open to all industry professionals and do not require registration.
ToolTech attendance does require registration. The event will take place April 29 to May 1 at the Hilton Charlotte University Place in North Carolina. ToolTech organizers expect about 150 attendees.
The event will include an opening dinner at the NASCAR Hall of Fame, a product showcase and company spotlight, networking opportunities, one-on-one appointments, and OEM and shop owners’ panels. Scheduled speakers include …
• Jeff DeGraff, University of Michigan, clinical professor of business administration, “How to See the Future First.”
• John Waraniak, SEMA vice president of vehicle technology, “Racing to Autonomy, Automotive 4.0.”
• Evan Hirsh, PwC principal and Strategy& advisor, “Emerging Vehicle Technologies.”
• Greg Carfine, Whitebox Inc. strategic accounts director, “Swimming in Amazon.com Without Being Eaten.”
ZF Technical Training Sets 2019 Schedule
ZF Technical Training has announced its schedule for full-day training classes in which technicians can take advantage of hands-on learning with ZF Aftermarket’s technical trainers. The course schedule for “8HP Transmission Diagnostics & Overhaul” is …
• March 30 at the ZF location in Vernon Hills, IL.
• June 22 in Los Angeles, CA.
• June 22 (Spanish class) in Los Angeles.
“6HP Transmission Diagnostics & Overhaul” will take place Sept. 14 in Toronto.
The course schedule for “Modern Chassis Technologies” is …
• April 27 in Dallas.
• Aug. 10 in the New York City/Philadelphia area.
• Oct. 12 in Detroit.
In each class, attendees will receive training with an ASE-certified ZF technical trainer who will review essential information, address common concerns and give technicians strategies to better meet industry challenges. Registration is now open. Classes are limited to 25 people.
Lincoln Tech Facility Renovated Via Icahn Auto’s ‘Race To 2026’ Program
Icahn Automotive’s national “Race to 2026” program has led to renovated classrooms at Lincoln Technical Institute’s Philadelphia campus. The initiative — which launched earlier this year at Universal Technical Institute’s (UTI) NASCAR Technical Institute in Mooresville, NC — is intended to invest in and support promising future automotive technicians as they make their way from the classroom to the service bay.
With “Race to 2026,” Icahn Automotive is encouraging more people to pursue careers in the skilled trades by …
• Partnering with technical training schools like Lincoln Tech.
• Offering scholarships, tuition reimbursement and apprentice programs.
• Creating internship programs, job placement initiatives and continuing education opportunities.
“We’re committed to training tomorrow’s automotive technicians and shifting the perception of the industry so that more students are attracted to this viable career,” said Icahn Automotive President of Service Brian Kaner.
Additional Icahn Automotive-sponsored learning facilities will be established at other UTI and Lincoln Tech locations nationally, as well as at Alfred State College of Technology.
The initiative also includes a scholarship program that will award 12 scholarships to full- or part-time students enrolled in an automotive technician degree and/or certification program at the high school, college or trade school level. Applications are being accepted through April 30. Recipients will be announced in June.
Icahn Automotive, an Icahn Enterprises L.P. company, owns and operates Pep Boys, AAMCO and Precision Tune Auto Care facilities.
UTI Initiative Lets High School Juniors Sample Tech Programs
To address growing workforce demand for skilled technicians, the Universal Technical Institute (UTI) is bringing back Ignite, a free summer program designed to give high school juniors a firsthand look at careers in the transportation industry. Participating students will receive hands-on technical training and the opportunity to earn credit toward a UTI program. The program will be offered at each of UTI’s campuses nationwide.
During the three-week program, participants will be able to sample the automotive, diesel, collision repair and motorcycle training that full-time UTI students take. Students also will explore career opportunities in the transportation field, as well as learn about the need and earning potential for trained technicians from UTI graduates and local employers.
UTI launched the Ignite program nationwide last summer following a pilot program at campuses in Avondale, AZ; Houston; and Orlando in 2017. For more information, visit uti.edu/ignite.
Southern Tire Mart Buying 52 GCR Tires & Service Locations
Southern Tire Mart has reached an agreement to purchase 46 GCR Tires & Service shops and six GCR retread plants from Bridgestone Americas. Financial terms of the transaction were not disclosed.
The deal would allow Southern Tire Mart to serve more customers in markets where it currently operates, as well as expand its footprint into new regions. The GCR locations being purchased are in Alabama, Arkansas, Arizona, the Florida Panhandle, Georgia, Louisiana, Mississippi, New Mexico, Nevada, Tennessee, Texas, Utah and Virginia. They currently serve customers in the commercial trucking, off-road and agricultural industries. The shops will be transitioned from GCR to Southern Tire Mart.
Southern Tire Mart is a provider of commercial truck tires, off-road tires, and Bandag retreads that’s based in Columbia, MS and operates more than 90 commercial truck tire centers in 10 states.
Bridgestone will continue to operate more than 130 GCR locations across the United States and Canada.
Pilot Flying J Debuts Real-Time Virtual Maintenance System For Fleets
Pilot Flying J is launching a new virtual maintenance system called Fleet Center that’s part of the company’s Truck Care service platform. Available this month, the portal provides fleets with real-time visibility and flexibility to manage their equipment. Features include …
• The ability to schedule services, generate and authorize work orders, and receive repair estimates.
• Real-time status updates for en route, onsite and roll times.
• The ability to “live chat” with Truck Care representatives for customer service.
• Full access to service history and transaction details.
The aim is to reduce downtime, increase speed of service, and improve account management for fleets and professional drivers.
Rolled out in 2017, Pilot Flying J’s Truck Care program now includes 24 service centers and over 135 roadside assistance vehicles across 36 states.
Sea Foam Sales Company is looking for a knowledgeable, enthusiastic person to assume responsibility for our Wisconsin territory. Candidates must be a self-motivated, sales driven person with a good working knowledge of gas and diesel engines in a variety of industries and applications. … (more) … Click here to find out more.
Battery Biz is looking for a National Sales Manager to join our growing team! Battery-Biz (the Biz) is an employee-owned company with headquarters located in Camarillo, California. … (more) … Click here to find out more.
Standard Brings Back Contest For Aspiring Diesel Techs
The Standard “Bigger, Better Diesel” automotive scholarship contest — now in its second year — will present four up-and-coming diesel technicians with $5,000 scholarships each. Eligible entrants must be between the ages of 18 and 34, and currently enrolled full-time in high school or in an accredited two- or four-year college, university, or post-high school educational program. The contest runs through May 31. For more information, visit youtube.com/StandardBrandParts.
TruRoad Acquires Auto Glass Businesses In New York, Oregon
TruRoad Auto Glass (Woburn, MA) — a provider of in-shop and mobile auto glass repair, replacement and recalibration services — has acquired Apple Auto Glass of Portland, OR and Hudson Valley Auto Glass of Wappingers Falls, NY (servicing Westchester County, the Lower Hudson Valley and Duchess County). The move expands TruRoad’s national footprint of corporate-owned auto glass repair, replacement and ADAS recalibration service centers. The company operates JN Phillips Auto Glass, Techna Glass, Harmon Auto Glass and Windshield Centers.
CARS Partners With Repairify
The CARS Cooperative is partnering with Repairify Inc. to offer to its members vehicle diagnostic and calibration services for pre-repair and post-repair conditions. Repairify is the maker of the asTech diagnostic device. Co-op members have more than 700 body shop locations across the United States.
News Briefs 4/2/19
• Take 5 Oil Change is seeking two to three franchise partners to open as many as 45 shops in Michigan — with as many as 28 locations in the Detroit area, according to a March 4 report in The Detroit News. This comes at a time when Take 5 has been expanding across the Great Lakes region, opening shops in Illinois, Indiana and Wisconsin, to name a few.
• The Automotive Maintenance & Repair Association (AMRA) and Motorist Assurance Program (MAP) Spring 2019 Technical Conference will take place May 8-9 at the OLC Education & Conference Center on West Higgins Road in Rosemont, IL. Click here for more information on this MAP Technical Committee event.
• CarMax is now a TechForce Foundation “FutureTech Success” campaign partner. The initiative is designed to close the widening skills gap and inspire students’ interest in transportation tech careers. Richmond, VA-based CarMax is the largest used car retailer in the United States and a Fortune 500 company.
• Spanesi Americas has added Bob Hiser as a technical trainer and OEM liaison. Hiser is an industry veteran with over 30 years of OEM experience in the research, creation, and distribution of OEM repair processes and procedures for General Motors.
• Mitchell 1 has enhanced its TruckSeries truck repair software with a 1Search Plus interface, which is designed to scan the database of Mitchell 1 content and return only the specific information the technician needs to make the necessary diagnosis and repair. Information relevant to the selected vehicle is delivered in a single location.
• RNR Tire Express says it donated more than $1 million in money, time, talent and goods to charities in 2018.